Holy tax dodging! Google reportedly skirted a whopping $2 billion in worldwide income taxes in 2011 by unloading $9.8 billion in revenue into a Bermuda shell company, reports Bloomberg. Since Bermuda has no corporate income tax, Google slashed its tax rate nearly in half.
The legal move utilizes “transfer pricing,” which are paper transactions to corporate subsidiaries that allocate expenses to higher-tax countries and income to tax havens.
The European Union’s European Commission wants to clamp down on sunny tax loopholes by creating a blacklist of tax havens, which apparently cost the EU $1.3 trillion euros. The UK is Google’s second-biggest market, accounting for 11 percent of its sales (or $4.1 billion).
Google, for its part, reminded the great people of Europe that, in the UK, “we also employ over 2,000 people, help hundreds of thousands of businesses to grow online, and invest millions supporting new tech businesses in East London.” Thank you, Google.
Read more from Bloomberg, here.